Open Circular Innovation: How Companies Can Develop Circular Innovations in Collaboration with Stakeholders

Abstract

A transition toward the circular economy (CE) will be key to addressing future environmental and economic challenges, such as environmental pollution and resource scarcity. However, when introducing circular solutions, companies often face complex and disruptive changes that affect many stakeholders and require new innovation practices. This study investigates open circular innovation by analyzing the status quo of circular innovation, discussing the relevance and role of different stakeholders, and examining approaches for open circular innovation processes. The study employs a qualitative research design, including 14 in-depth interviews with CE and innovation experts. The findings indicate that companies currently focus on closed innovation approaches or collaborate with only one stakeholder at a time when developing circular innovations. Stakeholder groups, such as customers, suppliers, and academia, play a crucial role in the innovation process, whereas direct collaborations with governments and competitors are seen controversially. An open innovation network approach combined with crowdsourcing is regarded as the most promising for developing circular solutions. This study contributes to connecting open innovation with CE research and provides new knowledge at this interface. Additionally, this research gives managers guidance on how to approach open circular innovation and thus supports companies on their way toward a CE.

Linking Eco-Innovation and Circular Economy—A Conceptual Approach

“…The analysis was conducted over the last ten years and used the search terms "eco-innovation", "business models", and "circular economy" as all are relevant to the concept and the theoretical framework developed. In this way, this article not only fits into the most current and dynamically developing research area, which is the link between eco-innovations, business models, and a closed-loop economy, but also attempts to fill that highlighted in the literature [2,7] research gap relating to the identification of specific practices that support the generation and implementation of eco-innovations necessary for closing material flows.…”

“…At this point, it should also be noted that the implementation of the described management practices in companies is a complex logistical and economic challenge, and consequently requires undertaking cooperation with various stakeholders [2]. Since the generation and implementation of circular products or processes is embedded in both intra and interorganizational activities and procedures, it is therefore important to also include the concept of open innovation (OI) in the considerations [10][11][12].…”

“…On the other hand, the open innovation paradigm can be seen as a necessary strategy to manage customer relationships by leveraging their knowledge and experience in the ecodesign process and, more importantly, gaining their acceptance for the subsequent launch of circular products [2]. In this view, an open innovation strategy (based, for example, on crowdsourcing) is indispensable to realize sustainable consumption patterns.…”

“…Despite increasing environmental degradation, most of the world's economies still operate on a traditional linear model of economic activity based on cheap energy and readily available resources. This model, known as "take-make-dispose" [1,2] is characterized by a unidirectional flow of materials: from raw materials that are transformed into products and ultimately into waste. However, this linear approach to production and consumption processes does not take into account the environmental burdens and natural limits to economic growth resulting from, for example, climate change due to increasing greenhouse gas emissions and the depletion of nonrenewable resources (i.e., fossil fuels or mineral resources).…”

You Can’t Go Circular Alone – A Stakeholder Approach to Circular Innovation

“…Circular solutions with a high circularity impact are usually embedded in a complex network of internal and external stakeholders (Aminoff & Pihlajamaa, 2020). Circular innovation is therefore difficult to achieve using traditional innovation processes (Eisenreich et al, 2021). A more suitable approach to addressing this complex stakeholder situation is the paradigm of open innovation (Chesbrough, 2003) that suggests using ideas from inside and outside the company when developing innovations.…”